AAR: 18% GST Rate Levy on Selling of Automatic Weighing Machine

The Karnataka Authority of Advanced Ruling passed a ruling that 18% GST is liable to be paid on the selling and manufacturing of Automatic Weighing Machines

The applicant, Wave Colour Techniques is indulged in the manufacturing and supply of machines to farmers and farmer’s cluster in the domain of Grapes and Raisin Processing namely

• Raisin Wet Processing/ Washing Setup,
• Raisin Drying Setup,
• Raisins Dry Process-Cleaning,
• Grading Setup,
• Raisins / Dry Grapes Colour Sorting Setup,
• Raisins De-stemming / Stem Removing Setup and
• Raisins Weighing Setup.

The applicant mentioned that the process line for raisins include machines for washing along with breaking the lumps, doing automatic sulphuring (if it is felt necessary), removal of stones and wood sticks, drying in automatic machines, then healing and removing stems, cleaning along with grading, handpicking and finally automatic weighing, packing and further packing being done inside the cartoon boxes. The above-mentioned machines are related to processing like

• Cleaning
• Grading,
• Drying and
• Packing of Raisins and Grapes

The applicant was seeking an advance ruling related to the issue of the charging of GST that is applicable on various machines sold by the applicant

The Coram of Members Mashhood ur Rehman and M.P. Ravi Prasad passed a ruling that the “machinery manufactured and sold by the applicant like Automatic Feeder with Breaker, Drying machine, Cleaning, and Grading Machine and Pre-stem remover are taxable at 6% under the CGST Act, 2017 and 6% under the KGST Act, 2016.”

The AAR (Authority for Advance Rulings) held that the Automatic Weighing Machine that is manufactured and sold by the applicant is subject to tax at

• 9% under the CGST Act, 2017, and
• 9% under the KGST Act, 2017